At least one resident of the Blue Earth Area School District thinks the upcoming referendum vote is a definite ‘vote yes’ situation.
After hearing BEA Superintendent Dale Brandsoy present the facts of the referendum to a group of senior citizens, he raised his fist in the air and let out a cheer, urging his fellow seniors to get up and go vote.
It does appear to be a no-brainer, as one person put it. He said it was simple: the school needs the money to continue to be an excellent school, and voting yes wasn’t going to raise taxes any more than they already are.
He is right. On both counts.
The vote on Nov. 3 is whether to continue the current levy referendum, in place for the past five years, for another five years.
Since residents have been paying for it already, and the school district is asking for the same amount as before, taxes should not increase due to the referendum. They can, of course, increase due to some other reason, but not because the school levy referendum passes.
The referendum brings in some serious money. Since they are asking to keep the $650 per pupil amount, same as before, the district will see $908,000 per year in additional revenue because of it.
The good news, too, is that the state will pay nearly half of that, or $440,675.
Brandsoy says that means the levy would add a tax on a $100,000 home of about $130. But remember, that homeowner has been paying that amount already for the past five years.
Actually, he was paying as much as $150 during the past five years, but due to declining enrollment, he only has to pay $130 as his share of the $650 per pupil being raised now.
It is that declining enrollment issue which is the main basis for the need for an excess levy referendum.
BEA, like most schools, has fewer students each year. In fact, in the past seven years, Blue Earth Area Schools has lost 216 students. In 2005-06 enrollment was at 1,278. This year it is at 1,190. In two years it is projected to be at 1,148.
Since the State of Minnesota funds schools by the number of students in attendance, this means BEA has lost $1.1 million in revenue in the past seven years due to declining enrollment.
They are projected to have 20 fewer students next year, Brandsoy says. That will translate into a $102,480 loss.
This past year the district had to make cuts to its budget, and also used some money from their reserves so that additional cuts didn’t have to be made.
Those reserves are a problem when it comes time to ask for an excess levy. The school has over $4 million in reserves, and some people wonder why an excess levy is necessary with that much money ‘in the bank.’
The answer is that the school must keep a balance of three month’s of expenses on hand. In BEA’s case, that is about $2.5 million.
If the referendum does not pass, the fund balance of $4 million will shrink to $500,000 in the next five years. With the referendum in place, the reserves will still shrink, but just to the $2.5 million amount needed to be kept on hand.
The bottom line is that the school does, indeed, need to keep this levy in place. Without it, they will need to trim between $800,000 and $1 million from their budget this next year alone. And dip too far into their reserves in the future.
Blue Earth Area is not alone in this predicament. Now 90 percent of the schools in the state are asking to keep, or start an excess levy referendum. BEA’s, at $650 per student, is way less than most of the ones in this area. USC and JCC are both at $1,000 per student excess levy, for instance. Only Fairmont, at $500, is lower than BEA.
The state average is $849.
In order to keep a solid school system in place in this community, we urge you to vote yes for continuing the school referendum levy in place for another five years.
Check out the brochure you received in the mail from the school, or the public notice elsewhere in this issue of the Register, to find out where your voting precinct is located, and when it will be open.
Then vote on Nov. 3.